India Shelter Finance Corporation reported strong Q3 FY26 results, with Gross Managed Assets growing 31% YoY to Rs. 10,365 crores. Profit After Tax surged 33% YoY to Rs. 128 crores, leading to an ROE of 17.1%. Management noted the housing market remains robust despite a softer growth period, pointing to green shoots in December and January collections. Asset quality saw a temporary spike to 1.5% Stage-3 due to proactive clean-up actions taken in the late overdue buckets.
Q3 FY26 Financial Performance Overview
The Management Team, including MD & CEO Mr. Rupinder Singh and CFO Mr. Ashish Gupta, provided an update on the performance for the quarter ended December 31, 2025. The company remains committed to its guided growth targets, seeing a supportive environment following the 125 bps cumulative repo rate cuts in 2025.
Asset Growth and Disbursements
Annual growth remains within the guided range, with Gross Managed Assets reaching Rs. 10,365 crores, marking an 11% YoY growth in Q3 disbursements to Rs. 977 crores. Management attributed the softer growth end to monitoring asset quality trends. The company added two new branches this quarter, aiming for 40 to 45 for the full year. Digital sourcing now accounts for 4% to 5% of disbursements, with a target of 10% going forward.
Profitability and Funding
- Profit After Tax for the quarter stood at Rs. 128 crores (33% YoY growth).
- Return on Equity (ROE) was 17.1%.
- Net Worth crossed the Rs. 3,000 crores mark, standing at Rs. 3,048 crores.
- Portfolio Yield remained stable at 14.9%.
- Cost of Funds decreased by 50 bps YoY to 8.3% (Marginal Cost of Fund at 8.1% in Q3).
Asset Quality Metrics
Gross Stage-3 and Net Stage-3 stood at 1.5% and 1.2%, respectively, as of December 31, 2025. Management clarified that the rise in Stage-3 loans was a result of proactively moving delinquent accounts into the higher bucket for resolution, rather than letting them remain stuck in the lower overdue buckets. This action was harsh but necessary to prevent further swelling later. Credit cost for nine months was 0.5%, aligned with the medium-term guidance of 40 to 50 bps for the year.
Guidance and Outlook
The company reiterated its guidance for the full year:
- Branch openings: 40 to 45 (35 already opened).
- Credit Cost: Around 40 to 50 bps.
- Loan Growth projection remains 30% to 35%, with an intent to close around 30%.
For the upcoming financial year (FY27), the company is targeting 30% AUM growth. Management expects Stage-3 to normalize back towards 1.2% to 1.4% by the end of Q4, with a normalized target of 1.2% to 1.25% for FY27.
Customer Cohort and Attrition
The maximum customer base (over 80%) is self-employed, with similar delinquency behavior seen across both Home Loan (HL) and Loan Against Property (LAP) segments. Branch attrition remains range-bound at about 35%. The company is focusing internal remediation efforts on lower ticket sizes (sub-Rs. 5 lakhs) where delinquency impact is higher.
PMAY Scheme Progress
The PMAY 2.0 scheme, implemented in October, is gaining traction. More than 2,000 customers have already received subsidies, with disbursements picking up significantly in Q2 and Q3, showing strong pipeline build-up heading into the next financial year.
Source: BSE
